Fueled by firm seller quotations and strong demand for high-quality batches, particularly towards the end of the month, Brazil witnessed a notable rise in cotton prices during November 2024. This upward trend was further supported by positive global market dynamics, says Centre for Advanced Studies on Applied Economics (CEPEA).

From October 31 to November 29, the CEPEA/ESALQ cotton index (payment in 8 days) increased by 3.35 per cent, closing at BRL 4.0654 (~$0.67) per pound on November 29.

The market was shaped by a combination of domestic and international demand. As the year draws to a close, traders have prioritised fulfilling term contracts, though there was still active negotiation to address immediate supply needs.

In the first 14 producing days of November, Brazil reported a 15.1 per cent decline in cotton exports to 215.4,000 tons of cotton, compared to the same period in 2023. However, daily average export volume of the country increased by 21.3 per cent Y-o-Y, indicating potential total export volume of 292.3000 tons by the month's end, based on CEPEA’s latest fortnightly report.

Looking ahead, the National Supply Company (CONAB) projects, cotton production in the 2024-25 season is estimated to increase by 1.06 per cent to 3.704 million tons. This growth is attributed to an anticipated expansion in the cultivation area and a modest rise in productivity.

Domestic cotton consumption is also expected to increase by 1.43 per cent from October 2024 levels and a 2.16 per cent rise compared to the previous year. Exports are predicted to follow an upward trajectory, further strengthening Brazil’s role in the global cotton market.